EconPapers    
Economics at your fingertips  
 

Strategic trade in pollution permits

Alex Dickson () and Ian MacKenzie ()

Journal of Environmental Economics and Management, 2018, vol. 87, issue C, 94-113

Abstract: Markets for pollution have become a popular regulatory instrument. In this article we investigate the implications of strategic trade in pollution permits. The permit market is developed as a strategic market game, where all firms are allowed to behave strategically and their roles as buyers or sellers of permits are determined endogenously with price-mediated trade. In a second stage, firms transact on a product market and we allow for a variety of market structures. We identify a unique equilibrium in permit exchange, investigate the properties of this equilibrium, and consider the effect of strategic behavior in the product market.

Keywords: Pollution market; Market power; Strategic market game (search for similar items in EconPapers)
JEL-codes: D43 Q52 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0095069616302455
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Strategic trade in pollution permits (2016) Downloads
Working Paper: Strategic trade in pollution permits (2016) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jeeman:v:87:y:2018:i:c:p:94-113

Access Statistics for this article

Journal of Environmental Economics and Management is currently edited by M.A. Cole, A. Lange, D.J. Phaneuf, D. Popp, M.J. Roberts, M.D. Smith, C. Timmins, Q. Weninger and A.J. Yates

More articles in Journal of Environmental Economics and Management from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

 
Page updated 2019-04-12
Handle: RePEc:eee:jeeman:v:87:y:2018:i:c:p:94-113